NORD/LB and KfW Bankengruppe securitise new asset class / First synthetic securitisation of loans to East German housing companies

Frankfurt (ots) - With the "primus MULTI HAUS 2006" transaction,
which is modelled on the basis of the established securitisation
platforms of KfW Bankengruppe, NORD/LB has for the first time
securitised the risks of a portfolio of loans extended exclusively to
East German housing companies. The transaction is to be closed today.

"The positive assessments of the rating agencies and the huge
interest from investors underline the attractiveness of our
portfolio," said Jürgen Machalett, General Manager of NORD/LB
responsible for corporate banking. The decisive advantage of such a
securitisation is the released equity capital. "We will use these
resources to extend further loans to the housing industry in East
Germany", announced Machalett. "With this transaction the bank
emphasizes its long-term commitment to the region".

Dr. Dieter Glüder, Head of Asset Securitisation of KfW, emphasized
that, in addition to private and small commercial housing loans as
well as SME and infrastructure loans, "primus MULTI HAUS 2006" is the
first transaction conducted through KfW, under which loans to East
German housing companies are securitised. He was pleased to see that
this special asset class now also benefits from the positive impacts
which the standardised KfW securitisation platforms have on banks'
lending activities and the development of the capital market. "As
this transaction follows the same standards as those established
under our PROVIDE and PROMISE platforms, it is much easier for the
rating agencies and investors to assess the transaction. This is the
important advantage of standardisation, especially when introducing
new asset classes to the market", explained Dr. Glüder.

The "primus MULTI HAUS 2006" transaction covers loans to finance
the modernization of multi-family buildings in East Germany. With the
involvement of KfW loans of a total volume of EUR 382 million are
securitised in different tranches. The portfolio is composed of 133
loans extended by NORD/LB to altogether 24 housing companies. The
longest remaining maturity of the individual loans is of around 30
years. The average ticket size is approximately EUR 2.9 million.

KfW takes the role of an intermediary in the securitisation
transaction assuming the default risk of the underlying loan
portfolios of NORD/LB. Simultaneously, the risk is transferred to the
capital and swap markets. The largest part of the total
securitisation volume, i.e. around EUR 256 million, is covered by a
super senior swap concluded on between KfW and an OECD bank. Another
part of EUR 126.6 million is hedged in the form of credit-linked
notes (CLNs) via a special-purpose vehicle (primus MULTI HAUS 2006)
established by TSI Service GmbH in Germany. The CLNs placed in the
capital market were analysed and rated by the rating agencies Moody's
and Standard & Poor's.

The transaction was arranged by NORD/LB and Banc of America
Securities Ltd. and placed by Banc of America Securities Limited. The
tranches were oversubscribed up to three times.

The prices of the individual tranches were fixed on June 6 2006
and are as follows:

** You find the complete press statement with the tabular overview
on our Homepage under www.kfw.de **

For more than 15 years NORD/LB, in cooperation with local savings
banks, has acted as a well-regarded partner of the housing industry
in East Germany. It has centralised its housing-sector activities in
Magdeburg, thus presenting itself as a service provider for the
housing industry covering all areas of the banking business. In
addition, as a Landesbank with a regional focus it is actively
involved in the "Urban Redevelopment Programme for East Germany"
jointly implemented by the German government and the federal states
and is a sponsor of the International Building Exhibition
Saxony-Anhalt 2010. "The strategic orientation of the bank aims at
both active support for the customers in mastering urban
redevelopment in declining regions and the acquisition of new
customers and new business in the growth regions of East German",
adds Jens Zillmann, bank director in charge of the "Housing industry"
unit in Magdeburg.

Originaltext: KfW
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Press contacts:

NORD/LB: Jan-Peter Hinrichs,
Phone: +49-(0)511-361 9934,
E-Mail: jan-peter.hinrichs@nordlb.de

KfW Bankengruppe: Nathalie Drücke,
Phone: +49-(0)69-7431 2098,
E-Mail: nathalie.druecke@kfw.de